Mar 18, 2020
Funding Options, the marketplace for business finance, is working hard to support independent UK businesses following a rapid increase in the number of loan applications. Around 1,884 businesses in the UK applied for £101,937,336 in loans during a 48 hour window.
This is 500% greater than a normal day, suggesting that UK businesses are already taking action to alleviate cashflow concerns caused by the COVID-19 pandemic.
- Independent businesses applied for loans worth £101,937,336 in a 48 hour period between 00:01 Monday 16th March, and 23:59 Tuesday 17th March - This volume is 500% greater than a normal day of loan requests - The applications came from 1,884 businesses - Construction businesses have requested the most money - more than £13.2m - Most requests have come from vehicle repair businesses
The top five industries requesting loans are:construction, professional, scientific and technical businesses, accommodation & food services, and administrative and support services.
The spike in applications began before Chancellor Rishi Sunak MP announced his plans to boost the UK’s economy, and support UK SMEs via loans underwritten by the Government. It’s clear that UK businesses aren’t able to wait for those loans, and have taken decisive action now to steady their cashflow worries. Funding Options and its 200 lender partners are working hard to meet demand amidst these difficult times, and help businesses cover their costs.
At present, the Chancellor’s funds and Government guarantees are not available to alternative lenders. Only those currently participating in the EFG scheme, which has been running since 2009 and is administered by the British Business Bank, can participate. However, a lower base rate means that loans are currently more affordable, and Funding Options is well positioned to offer an alternative route to finance.
Simon Cureton, CEO, Funding Options, says: “The surge in loan applications shows businesses are hugely concerned about their cashflow through this difficult time. Despite the Chancellor’s forthcoming boost to the economy, the sheer increase we’ve seen in the volume of loan applications is a sign of how worried businesses are about staying afloat during this pandemic. It’s clear that many feel like they simply can’t wait for the loans guaranteed by the government, as cashflow is being hit right now.
Luckily, businesses are able to take advantage of the low base rate, and get loans at a more competitive rate than they would do normally. Given the extenuating circumstances, we’re working round the clock with our lenders to ensure we can get money to businesses as quickly as possible. We will continue to monitor the situation, and ensure we’re able to help as many businesses as possible during these difficult times.”
Cureton continues: “I think it is a massive oversight for the Government to ignore alternative lenders. Given the current unprecedented market conditions we all find ourselves in, the demand for business finance simply cannot be satiated unless the government, the British Business Bank and other bodies must work in a coordinated and decisive manner. That means working alongside all of the key players in the SME lending market, including the full spectrum of lenders but also the fintech aggregators at the heart of SME lending in the UK.
“In the same way businesses have had to adapt to the coronavirus by working remotely and implementing new processes to get the job done and save people’s livelihoods, so too will the government need to respond differently, turning to not only the banks but also the challengers in a way it hasn’t done before.”
Funding Options is the leading marketplace for business finance, helping businesses across the UK and Netherlands find the right funding for their situation. With 200 lender partners, Funding Options is delivering hundreds of millions of pounds in vital finance to thousands of businesses every year. Whether you’re looking to grow, finance new assets or pay off a tax bill - Their award-winning technology searches the market to find the right funding options for your situation. It takes minutes, there’s no obligation, and it’s easy to use. A dedicated team of experienced Business Finance Specialists are there to take out the legwork, ensuring that you can focus on what matters most - running your business.
Funding Options is one of the winners in Nesta’s Open Up Challenge for Open Banking, and has been designated by HM Treasury for the bank referral scheme, to help UK SMEs find alternative finance when they're unsuccessful with the major banks.
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